Template-type: ReDIF-Paper 1.0
Author-Name: Ernst Baltensperger
Author-Name-First: Ernst
Author-Name-Last: Baltensperger
Author-Name: Philipp Hildebrand
Author-Name-First: Philipp
Author-Name-Last: Hildebrand
Author-Name: Thomas Jordan
Author-Name-First: Thomas
Author-Name-Last: Jordan
Title: The Swiss National Bank's monetary policy concept - an example of a 'principles-based' policy framework
Abstract: The practice of monetary policy has evolved a great deal since the early 1990s. This evolution was significantly influenced by rapid developments in the theory of monetary policy. A new consensus about 'principles-based' monetary policy appears to be emerging. It marries a firm long-term anchor for nominal stability, rooted in the original ideas behind inflation targeting, with short-term flexibility, based on a more discretionary and pragmatic approach to monetary policy. The SNB's monetary policy framework - with a firm nominal anchor but with an emphasis on the need for flexibility - reflects, to a considerable degree, the emerging academic consensus about best-practice monetary policy. With its successful seven-year track record, it may serve as an interesting case study for a policy aiming at an intermediate position between full discretion and rigidly defined short-term inflation targeting.
Length: 30 pages
Creation-Date: 2007
Contact-Email: forschung@snb.ch
File-URL: https://www.snb.ch/en/publications/research/economic-studies/2007/03/economic_studies_2007_03
File-Format: text/html
Number: 2007-03
Classification-JEL: E42, E52, E58
Keywords: Swiss National Bank, monetary policy, inflation targeting, rules, discretion
Handle: RePEc:snb:snbecs:2007-03